Cross-border workers and purchase of property in Switzerland. Is it possible?07 April 2021
Cross-border workers are very crucial part of Swiss workforce with many employees commuting form neighbouring countries to work every day. Can they purchase properties in Switzerland for investment or to move here?
Cross-border workers come to Switzerland mainly from France, Italy, Germany, and are employed in many sectors, from hotels and restaurants to financing or fintech. Some of these heavily rely on cross-border employees, for instance, healthcare system. When it comes to number, in 2019 as many as 325,000 cross-border workers were working in Switzerland. Majority of them come from France – 177,000, with rest from Italy, around 76,000, and Germany – 60,000. Last year these numbers were definitely lower, but situation was far from normal. Many cross-border workers were working remotely and stopped commuting to Switzerland due to the COVID pandemic and restrictions in travelling.
Cross-border Employees’ Rights
Those commuting to work to Switzerland from neighbouring, belonging to the European Union countries, are using G Permit to be allowed to work. Such permit gives them a right to cross borders each day. Also, when borders were closed due to the lockdown, owners of G Permit could still come to Switzerland. Cross-border workers have also other rights like health insurance provided from their workplace and a right to get vaccinated against COVID in Switzerland if they wish to. In some cases, cross-border employees can count on beneficial tax arrangements.
Can holders of G Permit buy a property in Switzerland? Cross-border workers are not allowed to move to the country, this G Permit gives them only a right commute here, not to live permanently. So, buying a property to reside does not make sense for cross-border workers. They can, of course, buy a property just as a part home for days when they work in Switzerland or as a holiday home. When it comes to buying the property for living during the week to avoid commuting every day or as a place to stay for holidays, it is allowed as long as the property is close to the place of work of a cross-border worker and connected to his or hers work. For instance, the property can not be rented out even partially, as this would mean the purchase was made in order to make money, not to help in dividing life between two countries.
What to Consider Before a Property Purchase?
For property purchase cross-border workers do not need any additional authorizations or permits, as long as the property has under 1,000 square metres. For bigger properties there is required a special authorisation from cantonal authorities. Before making a purchase, cross-border workers should also consider the financial aspect of a transaction. Most Swiss banks do not give mortgage to cross-border workers, some do but only for financing a purchase of Swiss properties. Some Swiss banks put a condition that a cross-border worker need to have income earned in Switzerland or in Swiss francs, to be able to apply for a mortgage. If salaries are earned in other currencies, one should think also about the impact of exchange rate EUR/CHF when financing the purchase.
Investing in properties in Switzerland can be a good idea, as prices are stable and were not much affected by the pandemic. However, cross-border workers that hold G Permit are not allowed to make investments in properties.